SUSANNA STUMPF, an 86-year-old Los Angeles retiree, hurried down to CalFed bank one day earlier this year to straighten out her accounts.
The Stumpfs -- who had done business with Glendale Federal Bank long before Glendale merged with CalFed -- had received letters saying their savings accounts were inactive and about to be turned over to the state as abandoned property.

After confirming that her savings accounts had not been abandoned, she then asked to see her safe-deposit box, which contained some gold and her mother's platinum Cartier watch, set with diamonds and sapphires.

She was told she had no box.

In fact, that branch had stopped offering safe-deposit boxes years before. Although Stumpf has lived in the same home for 30 years, she got no notification of the change.

``All they could tell me was to contact the state office of lost property in Sacramento. The answer was negative,'' Stumpf says. ``The last time I talked to the bank, they made me so angry. They said, `We have no proof you ever had a safe.' I said, `What about the key I have?' They said, `That doesn't prove anything.' ''

The contents of her box were worth tens of thousands of dollars, but the sentimental loss is far more significant, she says. ``I am not going to trust these safes anymore.''

The frightening thing about Stumpf's story is that it may be more common than reasonable people would dare imagine. Consumer after consumer maintain that the contents of their safe-deposit boxes and savings accounts have vanished. No one can account for their money and possessions. No one is willing to take responsibility for what was lost.

An investigation by the Los Angeles Times indicates that more than $260 million in assets, owned by more than 600,000 Californians, may have dropped into a bureaucratic black hole, made possible by both lax consumer protection laws and unenthusiastic administration of a state fund that's supposed to hold assets in trust for ``lost'' consumers. Although these assets reside with the state and can be borrowed to handle other state expenses, the names of the consumers who own these assets do not always make it into the state's computerized database of property owners.

And while the problem of unnamed accounts may be unique -- or at least exaggerated in California -- the underlying cause is often bank mergers, which are a nationwide issue. The holders of bank accounts and safe-deposit boxes everywhere should take particular care to double-check that all their account information remains correct in the event that their bank is merged with another.

The California State Controller's Office manages $2.4 billion in so-called ``unclaimed property'' for roughly 6.9 million Californians who are listed as missing -- but often are easy to find when anyone bothers to look.

Budgetary constraints bar the state from doing anything -- even sending postcards -- to find errant consumers, according to Byron Tucker, a spokesman for the controller's office.

Tucker also acknowledges that the names of some property owners are not in the database. ``It says right on our Web page that the database does not include everyone. If you think you're owed property but you don't find your name in the database, you should call our offices.''

Exactly how many people are missing? It is impossible to say.

The state does not keep these records, says Richard Chivaro, chief counsel for the controller's office. Chivaro said he cannot quantify the number of individuals who are missing, nor the value of the assets that they're owed. The last time the Unclaimed Property Division was mentioned in a statewide audit was in 1995.

The people who are missing from the database appear to fall into several categories:

There are people whose names have simply not been entered into the computer, either because the state just recently got their names or simply hasn't gotten around to updating their files.

There are those whose property is in the computer but is under the cryptic title ``owner unknown.''

And there are those who are owed such small amounts that the state doesn't require anyone to keep track of their names.
If your account happens to be one of those that does not have a name attached to it, searching for your assets is ``a needle in a haystack situation'' according to one unclaimed property administrator, whom Tucker describes as an expert. (Tucker later said he ``wouldn't characterize it as a needle in a haystack'' but adds that the state has recently been ``tightening up'' on requiring banks to put names to property that's sent to the state.)

Savings disappear
Whatever happened to elderly man's CDs?
But that crackdown may come too late for one needle in the haystack -- namely Alton Paul Bienaime, an elderly Los Angeles man.

Bienaime's life savings of $37,000 have disappeared. The money wasn't in a safe-deposit box; it was in bank certificates of deposit. He is stuck in a Catch-22: He knows that somebody -- probably the state's unclaimed-property division -- has the money. But the state keeps referring him to his bank; his bank keeps referring him to the state. Bienaime's name isn't in either party's records -- only on the CD papers he clutches in his fist.

``I'm sorry to be emotional about this,'' he says, his voice cracking. ``It's just that I'm 79 years old, and I was hoping to have this money to leave to my wife and my son.''

The data that the Times analyzed, a listing of 2,055 lots of gold, jewelry and memorabilia sold this year at an unclaimed-property auction, indicates that the ownership of some 228 lots is undeterminable. Of these 228 lots, 62 represent safe deposit boxes that contained items of significant value and should have had names attached to them but were instead listed as ``owner unknown.'' Another 166 lots fall into a subgroup of assets for which names are not required. California law says that banks can aggregate property worth $50 or less and turn it over to the state without bothering to say who owns it.

Sweeping up
Many unclaimed items fell on floor, bank says
There are literally hundreds of such items of relatively minor value that are escheated en masse when banks turn over the contents of dormant safe-deposit boxes each year, experts note. Why would anyone pay a safe-deposit fee -- ranging from about $15 to $60 annually -- to keep items of marginal value in a bank safe?

Usually, they don't. Instead, Tucker says these items are often the result of banks sweeping up the safe deposit booths and finding that someone dropped an earring or coins or some other item or items from their box. The volume of this type of material -- 166 lots worth in the May 1999 State Abandoned Property auction, including stamps, coin collections, watch collections, medal collections, silver and gold jewelry -- might lead you to believe that safe-deposit box owners are careless with their property.

However, Barbara Becker of Los Angeles has another explanation. Last December, she went to close her safe-deposit box but was told she had no box. When she insisted, waving her key, the teller disappeared for about 20 minutes before returning with a rumpled plastic bag that had a big slash in its side, she says. Although a few things had managed to stay in the bag, the bulk of Becker's coin collection, which included a spectrum of uncirculated silver coins, and a host of presidential memorabilia, was gone.

She complained to both the teller and bank manager, but has yet to receive any sort of response.

Many of the people who claim their property has disappeared without a trace bemoan the loss of items far too valuable to be aggregated. They may be among the ranks of the unaggregated ``unknown'' -- a group that accounted for 62, or 3 percent, of the 2,055 lots in the May auction.

How might items just disappear? One explanation is that they are transferred to the state without names attached -- despite the fact that banks frequently have customer names on numerous documents that were required to open safe-deposit boxes.

Impossible? Hardly, says Nancy Cockran, another Los Angeles resident. It nearly happened to her. Cockran recently went to get papers out of her safe-deposit box at Bank of America, where she has numerous other active accounts. No box. Clutching the key, she demanded to see the manager.

The next day they found her property in an envelope marked ``owner unknown.'' The bank has never explained why the box was drilled open; why it never notified Cockran; nor how the documents proving Cockran's ownership of the box could have been lost.

No tangible value
Documents, photos are simply destroyed
Ironically, the first document Cockran pulled out of the envelope was the deed to her house that included her name and current address. That would not have helped her retrieve her assets if the property ended up with the state, however. Anything that is determined not to have tangible financial value -- letters, personal papers, photographs, etc. -- are destroyed, says Tucker. The state doesn't have the room to store them.

Sophie Ong Lafferty has a virtually identical story. When she tried to get into her box a few months ago, the bank told her it had no record of it. The manager promised to investigate and call Lafferty within the week, but didn't. When a reporter interceded, a bank investigator called Lafferty and was able to find her possessions. They, too, were in a box, listed under the heading ``owner unknown.''

``For every one of these cases like mine that get resolved, you have to wonder how many are lost forever,'' Lafferty says. ``It is quite worrisome.''

Indeed, what has happened to all of these consumers should never have happened, bankers and the state agree.

What's supposed to happen is this: If you have a bank account -- checking, savings, certificate of deposit, money market, etc. -- but don't deposit or withdraw from it for several years, the bank is supposed to send you a letter or postcard. The letter notifies you that your account is dormant and will be sent to the state's unclaimed property division for safekeeping if you don't come to claim it.

Meanwhile, safe-deposit boxes are not supposed to be considered dormant unless you fail to pay the fees for at least three years. Presumably that means you ignore three years worth of bills, and at least one warning letter letting you know that your heirlooms are about to be escheated.

However, it seems that customer records -- and tracking -- has fallen by the wayside in the wake of rapid consolidation in the banking industry. Virtually every consumer interviewed for this story, with the exception of Bienaime, said that their woes began after one or more bank mergers. Many had received their safe-deposit boxes for free because they were such good customers of the bank.

None received notification of delinquent payment or of imminent escheatment of their property. Some had every reason to believe their accounts were active.

From free to fee
Some customers ignore notices
Bankers note that there can be a variety of reasons why these mistakes could be made, including merging banks that have different policies. One Wells Fargo customer, who has since sued but didn't want her name in print, for instance, lost her safe-deposit box after Wells Fargo bought Torrey Pines State Bank. Torrey Pines provided this box to the customer for free. Wells' policy was to charge $15 annually.

``There are a lot of things that can go wrong both on our side and the customer's side,'' says Kathy Shilkret of Wells Fargo. ``If a customer gets a bill for a box that's always been free, their first reaction may be that it's a mistake, so they disregard it.''

Rapid-fire acquisitions and branch closures -- in the past 10 years more than 4,363 banks have evaporated, usually as the result of mergers, according to the American Bankers Association in Washington, D.C. -- also could account for some of the troubles, Shilkret notes.

Free accounts are supposed to be coded differently, so branch workers know that the account is not in arrears, but free. However, each bank has its own system. If Wells Fargo bought a bank that didn't code free accounts, they might assume the account was abandoned.

However, the biggest culprit in this story may be California's Unclaimed Property law. This law spells out just what banks must do when accounts are inactive, including how quickly they must send the money to the state and what happens if they fail to do so promptly. If a bank fails to escheat promptly, it is subject to huge daily fines and interest penalties. The state also enthusiastically enforces -- with a staff of 20 auditors and a $2.1 million annual budget -- the portion of the law that requires banks to send funds from dormant accounts promptly, Tucker says.

On the other hand, the budget to find consumers whose property is sitting in state coffers is just $15,000, Tucker says.

The law's only requirement for consumer notification is that banks make a ``reasonable attempt'' to notify their customers by mail when their accounts are about to be turned over to the state. The penalty if they don't?

``There are no penalties for not notifying customers,'' says Shilkret, who hastens to add that Wells Fargo (and many other banks) do attempt to notify customers anyway. ``The penalties are all on the side of failing to report or pay the money to the state.''

``It seems to me that the whole system needs to be rejiggered,'' she adds.

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Quote:

"They said, `We have no proof you ever had a safe.' I said, `What about the key I have?' They said, `That doesn't prove anything."

As discussed in a previous thread about the FDIC, just because you have a "key" or bank statement "doesn't prove anything"!

Answers

Gawd! Of course, if you think a key to a non-existent box is worthless, wait until people try to present their account statements as proof that they REALLY DID have an account that REALLY DID have money, after Y2K hits....

Take a frigging hint! GET YOUR CASH OUT OF THE BANK. HIDE IT IN A SAFE AND SECURE PLACE. (We could also discuss stock market portfolios, but that is non-topical.)

This problem is not limited to safe deposit boxes. I live in
Florida. One day I was glancing through the list of abandoned
property to be sold by the Florida Department of State?. There was
my name. It was a balance of an account at a stockbroker where the
account had been closed about 3 years earlier. I applied for and
received a check for the balance. What happened was that the Post
Office had changed my zip code. I was living at the same house at
the same address except the zip code was changed. The letter with
the dividend check had been returned because of wrong zip code and
no one bothered to follow up. If I hadn't seen it, it would have
been given to the state even though my name and correct zip code were
in the phone book. No budget to check current address bla bla bla and
my BROKER did not bother to call me to see if my address had
changed. I am not impressed with his services to his clients and ex
clients. They are going to watch out for us on Y2k problems. Ha Ha
Ha. My bank has been through 4 mergers. I do not have an unsafe
deposit box there.